LONDON (Alliance News) - Shares in London have opened flat Friday, as investors digest mostly neutral GDP figures from the eurozone.
Aggreko is leading FTSE 100 gainers after the temporary power company said trading in the third quarter was in line with its expectations.
AIM stocks are slightly out-performing, led by Fitbug, up 43%, and Altona Energy, up 37%, following pre-market announcements.
Here is what you need to know at the UK market open:
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MARKETS
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FTSE 100: flat at 6,635.80
FTSE 250: up 0.1% at 15,642.03
AIM ALL-SHARE: up 0.2% at 719.80
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Hang Seng: closed up 0.3% at 24,087.38
Nikkei 225: closed up 0.6% at 17,490.83
DJIA: closed up 0.2% at 17,652.79
S&P 500: closed up 0.1% at 2,039.33
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GBP-USD: down at USD1.5673
EUR-USD: down at USD1.2452
GOLD: down at USD1,153.21 per ounce
OIL (Brent): down at USD77.14 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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Friday's Key Economic Events still to come
(all times in GMT)
09:00 Italy Gross Domestic Product
10:00 EU Consumer Price Index
10:00 EU Gross Domestic Product
13:30 US Export/Import Price Index
13:30 US Retail Sales
14:10 US Fed's Bullard speech
14:55 US Reuters/Michigan Consumer Sentiment Index Preliminary
15:00 US Business Inventories
15:30 US EIA Natural Gas Storage change
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The German economy expanded marginally in the third quarter as expected by economists, provisional data published by Destatis revealed. Gross domestic product rose 0.1% sequentially offsetting a 0.1% drop in the previous quarter. The growth rate matched economists' expectations. Positive contributions were made mainly by households, which considerably increased their final consumption expenditure. The balance of trade also made a positive contribution as exports grew more than imports.
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The French economy expanded more than expected in the third quarter, preliminary data from the statistical office Insee showed. Gross domestic product grew 0.3% from a quarter ago reversing a 0.1% fall in the second quarter. The economy was expected to grow marginally by 0.1%.
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The G20 summit is the best forum to promote free trade, British Prime Minister David Cameron said Friday, a day before leaders of world's 20 leading economies meet in the eastern Australian city of Brisbane. Cameron, among the first leaders of the grouping of wealthy nations to arrive for the summit, also warned against protectionism in a speech to parliament in Canberra. "If we are to bust the myths that stand in the way of the great new trade and investment deals now before us, we have to tell it to people straight - opening up trade doesn't cost jobs, it creates them," Cameron said. "Let's see though an EU-US deal that could be the biggest of its kind on the planet. And while we're at it, let's push for an EU-Australia deal too," he said.
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US Secretary of State John Kerry met with Israeli Prime Minister Benjamin Netanyahu and Jordanian King Abdullah II Thursday in Amman in a bid to quell unrest in Jerusalem. Kerry met separately with Palestinian President Mahmoud Abbas, and Abbas met separately with Abdullah on Wednesday. The most urgent issue was the growing tension between the two sides and the need to restore calm to a holy site in Jerusalem, called the Temple Mount by Jews and the Noble Sanctuary by Muslims. It has been at the centre of recent unrest.
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The leader of the Islamic State jihadist group - who had been presumed dead by some after a US airstrike - seemed to resurface in an audio recording released Thursday in which he said his group plans to expand beyond Syria and Iraq. The voice purportedly belonging to Abu Bakr al-Baghdadi vowed that the militant group would continue fighting "even if only one soldier remained" and planned to expand into countries other than Syria and Iraq, where it already controls territory.
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Senate Republicans unanimously elected Senator Mitch McConnell to serve as majority leader when the next session of Congress convenes in January. McConnell will replace Senator Leader Harry Reid, a Democrat. His takeover of the Senate leadership comes after Republicans picked up at least eight seats last week in by-elections. Separately, Democrats elected their own leadership, naming Reid to serve as minority leader in the incoming Congress.
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The US welcomed a deal between the Iraqi government and the semiautonomous regional Kurdish government on the export of Kurdish oil. State Department spokeswoman Jen Psaki described it as an initial step toward a fair and comprehensive solution on the management of Iraq's oil resources.
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BROKER RATING CHANGES
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TRADERS: HSBC RAISES WEIR GROUP TO 'NEUTRAL' ('UW') - TARGET 2300 (2500) PENCE
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SHORE CAPITAL INITIATES TSB WITH 'BUY' - TARGET 325 PENCE
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LIBERUM CUTS INTERNATIONAL PERSONAL FINANCE TO 'SELL' ('BUY')
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LIBERUM RAISES ASHMORE GROUP TO 'HOLD' ('SELL') - TARGET 298 (303) PENCE
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COMPANIES - FTSE 100
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Specialist engineering company IMI said revenue fell in four months to the end of October owing to the strength of sterling, and said it has proposed a deal to buy B&R Holding GmbH for EUR152.6 million. The FTSE 100-listed company said it expects its full year results to be broadly in line with market expectations, despite more difficult-than-expected trading conditions in Germany.
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Aggreko said trading in the third quarter was in line with its expectations as its revenue was hit by the strength of sterling. The FTSE 100-listed temporary power company said reported revenue in the three months to the end of September was down 3% due to the strength of sterling. Underlying revenue grew 6% in the quarter.
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J Sainsbury said it has launched an offering of around GBP400 million convertible bonds due 2019, part of the proceeds of which it said will be used to refinance the supermarket's acquisition of full ownership of Sainsbury's Bank earlier this year.
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Glencore is to close its Australian mines on a temporary basis due to the excessively supply of thermal coal that has pushed prices down to multi-year lows, Reuters reported. The shutdown will last for three weeks, Reuters reported. The report quoted the following Glencore statement: "This is a considered management decision given the current oversupply situation and reduces the need to push incremental sales into an already weak pricing environment."
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HM Revenue & Customs has fined British American Tobacco GBP650,000 for oversupplying cigarettes to Belgium, the BBC reported. The fine is the first time HMRC has imposed a penalty on a company for supplying to areas considered a "high risk" for smuggling, the BBC added. Belgium is considered a high risk country as cigarettes are sold significantly cheaper there in comparison to the UK due to lower taxes. BAT said it will appeal the "unjustified" fine.
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BP has lost a bid for a new trial on findings the company was grossly negligent in the Gulf of Mexico oil spill in 2010, exposing the company to USD18 billion in pollution-related fines, Bloomberg reported. The loss comes in the wake of a slew of legal setbacks for the oil company, including a failed bid to cut the cost of its settlement with victims of the oil spill. BP is now awaiting a decision by the US Supreme Court on whether it will hear its complaint that the settlement is being misinterpreted to compensate claimants that BP says it did not intend to pay, Bloomberg added.
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British lender The Royal Bank of Scotland Group's securities unit now plans to fully exit its US mortgage trading business, compared to its earlier plan to partly exit the mortgage-trading and distressed-loan trading business, according to media reports. RBS will now reportedly exit mortgage backed-security, commercial real estate, and commercial mortgage-bond sales and trading in the US However, RBS will retain its non-mortgage asset backed securities team.
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COMPANIES - FTSE 250
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Balfour Beatty said it has reached a deal to sell parts of its German rail business to Austrian company Rhomberg Sersa Rail Group. Balfour said the assets have been sold for GBP6 million, but said the net cash consideration will be zero once the cash transferring with the business is taken into account. It expects the deal to close in the first quarter of 2015.
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The Restaurant Group said total sales in the first 45 weeks of its financial year were up 10.3% year-on-year, albeit they have grown at a slower pace since the end of August. However, the restaurant operator said it is still confident in its outlook for the rest of the year. The owner of the chains Frankie & Benny's, Chiquito, Coast to Coast and Garfunkel's said sales growth has slowed since the end of August, and it also is facing some cost pressure.
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Rotork said its revenue for the third quarter fell on the back of the timing of deliveries, but said order intake rose and reiterated its expectation for revenue to be weighted to the fourth quarter. Revenue in the third quarter was down 1% year-on-year in the quarter to October 26, the FTSE 250 listed manufacturing company said, owing to the timing of deliveries. It said its year-to-date revenue is up 0.1% and said it expects revenue for the full year to be weighted to the fourth quarter.
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Premier Farnell said it saw sales per day rise in the third quarter of its financial year, but said its gross margin declined slightly on the back of weakness in Asia and Europe, and it now expects its full year operating margin to be lower than last year.
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Discount retailer B&M European Value Retail is in talks to buy dozens of Home Retail Group PLC's Homebase stores in a multi-million pound deal, Sky News reported. The talks are for B&M to buy "a substantial number" of the DIY stores on which Home Retail will be closing the doors over the next few years, according to Sky.
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COMPANIES - LONDON MAIN MARKET AND AIM
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Cyprotex issued a profit warning for the full year as the group came under pressure from delays in its development work and weaker-than-anticipated demand. The contract research organisation said the delays highlighted in its half-year results had continued to exacerbate in the second half and said it now expects earnings for the year to be slightly above break-even on revenue of around GBP11.7 million.
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Serabi Gold said gold production increased during the third quarter and said it expects the ramp up to continue and for costs to be reduced in the fourth quarter. Gold production for the quarter ended September 30 totalled 5,002 ounces of gold, compared to 3,452 ounces in the second quarter. The increased production during the quarter is due to production commencing at its Palito mine in Brazil at the beginning of July.
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CPPGroup, the beleaguered company that has been weighting up its financing options after getting caught up in a costly mis-selling scandal with major high street banks, said it has received "indications of interest" from investors to subscribe for GBP9.0 million of new equity, but also said it could be sold under a formal sale process that is currently at a preliminary stage. In a statement, CPP said it thinks a "satisfactory" agreement can be reached with its creditors in the case that it raises new equity.
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Altona Energy saw its shares jump after it said it has completed the signing of a joint venture agreement for the Arckaringa project in Australia with Sino-Aus Energy Group Ltd and Wintask Group Ltd as it reported a wider pretax loss for the financial year.
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Fitbug Says Its Kiqplan To Be Included On Samsung Digital Health Platform
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COMPANIES - INTERNATIONAL
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French aerospace giant Airbus Group reported higher results for the first nine months of 2014, driven by an enhanced operational performance across the company. In addition, the company confirmed its 2014 guidance. Nine-month net income amounted to EUR1.4 billion , up 16% from the prior-year figure of EUR1.2 billion. Group EBIT before one-offs improved 12% to EUR2.6 billion. Revenue for the nine-month period was up 4% year-over-year to EUR40.5 billion from EUR38.95 billion. In 2014, Airbus deliveries are expected be about the same level as in 2013, including the first A350 XWB delivery. ----------
Oilfield services provider Baker Hughes Inc confirmed late Thursday that it is in preliminary discussions regarding a potential acquisition by larger peer Halliburton Co. However, the company noted that the discussions may or may not lead to any transaction. Following the news, Baker Hughes shares added around 18%, including after-hours trading.
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Chinese e-commerce giant Alibaba Group Holding, which completed an historic multi-billion-dollar US initial public offering in September, announced it plans to launch an offering of senior unsecured notes, subject to market and other conditions. The company said it intends to use the net proceeds from its first US dollar bond offering primarily to refinance its existing credit facilities. However, the company is yet to reveal the principal amount, interest rates, maturity dates and other terms of the notes. The company said these will be determined at the time of pricing of the offering.
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Friday's Scheduled AGMs/EGMs
Matchtech Group
Genus
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By Tom Waite; thomaslwaite@alliancenews.com; @thomaslwaite
Copyright 2014 Alliance News Limited. All Rights Reserved.
29 Jul 2014 07:50
